Starbucks announced on Wednesday that it would offer new CEO Brian Niccol a compensation package worth approximately $113 million. This includes a $10 million signing bonus, a $75 million equity grant, and a potential annual grant worth $23 million beginning in fiscal 2025. Niccol will also receive an annual salary of $1.6 million and an annual cash bonus ranging from $3.6 million to $7.2 million based on his performance.
Notably, Niccol will not be required to relocate to Starbucks’ headquarters in Seattle, although he will commute as needed from his home in Newport Beach, California, where Chipotle Mexican Grill is based. Starbucks will cover any temporary housing costs and provide a personal chauffeur to facilitate transportation in Seattle until Niccol secures permanent housing. The company will also set up a small office in Newport Beach for him and grant him access to corporate travel via Starbucks’ plane.
A spokesperson from Starbucks praised Niccol’s track record, stating, “Brian Niccol has proven himself to be one of the most effective leaders in our industry, generating significant financial returns over many years. His compensation at Starbucks is tied directly to the company’s performance and the shared success of all our stakeholders. We’re confident in his ability to deliver long-term, enduring value for our partners, customers, and shareholders.”
Niccol takes over from former CEO Laxman Narasimhan, who had a tenure of 17 months and oversaw a 23.9% decline in the company’s share price, resulting in a $32 billion drop in market capitalization.
Much of Niccol’s compensation package is designed to match the salary he is leaving at Chipotle, where he led the company for six years and significantly boosted its stock price by 800%, alongside a nearly sevenfold increase in profits, according to Starbucks.
Since the pandemic, Starbucks transitioned to remote work for its office employees. Recently, founder Howard Schultz encouraged employees within commuting distance to return to the office for at least three days a week, citing “unintended consequences” of remote work that could hinder collaboration and connection to the company’s mission.
In addition to his substantial compensation package, Niccol will have access to Starbucks’ executive health program and eligibility for personal travel benefits of up to $250,000 on the corporate jet. However, like other executives at Starbucks, he will be prohibited from trading in coffee and dairy futures.